Cebu Winland Dev.

Corp vs Ong Siao Hua

FACTS: Hua bought 2 condominium units from Cebu Winland Development Corporation. The area per condominium unit as indicated
in the price list is 155 square meters and the price per square meter is P22,378.95.

On October 10, 1996, possession of the subject properties was turned over to Hua.

After the purchase price was fully paid on January 31, 1997, Cebu Winland sent to Hua Deeds of Absolute Sale for the two
condominium units for signature. Upon examination of the deed of absolute sale, Hua was distressed to find that the stated floor area is
only 127 square meters contrary to the area indicated in the price list which was 155 square meters.

Hua caused a verification survey of the said condominium units and discovered that the actual area is only 110 square meters per unit.
Hua demanded from Cebu Winland to refund the amount representing excess payments for the difference in the area.

Cebu Winland refused to refund the said amount. Consequently, Hua filed a Complaint on August 7, 1998 in the Regional Office of the
Housing and Land Use Regulatory Board (HLURB) in Cebu City. The Arbiter ruled that Hua's action had already prescribed pursuant to
Article 1543, in relation to Articles 1539 and 1542, of the Civil Code. Hua appealed.

Cebu Winland argues that it delivered possession of the subject properties to Hua on October 10, 1996, hence, Hua's action filed on
August 7, 1998 has already prescribed.

Hua, on the one hand, contends that his action has not prescribed because the prescriptive period has not begun to run as the same
must be reckoned from the execution of the deeds of sale which has not yet been done.

ISSUE: WON the transfer/delivery of possession of the subject property to respondent constitutes delivery as provided in Article 1543
of the NCC.

Ruling: No, there was no delivery.

Delivery as used in the Law on Sales refers to the concurrent transfer of two things: (1) possession and (2) ownership. In the same
vein, if the vendee is placed in actual possession of the property, but by agreement of the parties ownership of the same is retained by
the vendor until the vendee has fully paid the price, the mere transfer of the possession of the property subject of the sale is not the
delivery contemplated in the Law on Sales or as used in Article 1543 of the Civil Code.

In the case at bar, it appears that respondent was already placed in possession of the subject properties. However, it is crystal clear
that the deeds of absolute sale were still to be executed by the parties upon payment of the last installment. This fact shows that
ownership of the said properties was withheld by petitioner. Following case law, it is evident that the parties did not intend to
immediately transfer ownership of the subject properties until full payment and the execution of the deeds of absolute sale.
Consequently, there is no delivery to speak of in this case since what was transferred was possession only and not ownership of the
subject properties.

We, therefore, hold that the transfer of possession of the subject properties on October 10, 1996 to respondent cannot be considered
as delivery within the purview of Article 1543 of the Civil Code. It follows that since there has been no transfer of ownership of the
subject properties since the deeds of absolute sale have not yet been executed by the parties, the action filed by respondent has not
prescribed.